Anchorage property tax cut would save some businesses thousands

Posted: Monday, April 24, 2000

ANCHORAGE (AP) -- Mayor Rick Mystom's tax relief plan would deliver savings of more than $1.5 million collectively to the municipality's 20 biggest property owners. All are businesses, some of them based in other states.

The top property owners, according to 1999 figures adjusted by an average valuation increase suggested by city finance officials, would pay from $45,000 to $131,000 less in property taxes this year than last, on properties valued from about $32 million to $95 million.

In contrast, Anchorage homeowners would enjoy a slimmer piece of the pie. By Mystrom's estimate, the owners of an average $184,000 home would pay about $260 less in property taxes for city services and schools this year than they did in 1999.

The Anchorage Assembly will consider Mystrom's plan Tuesday.

Mystrom said it's fair for the city's biggest property owners to get the lion's share of the savings because they pay the lion's share of the taxes. Hickel Investment Co., for example, stands to pay about $1.5 million in taxes this year, even if the mayor's cut is approved. The company's 2000 tax bill would be about $131,000 lower than it was in 1999.

''Everybody benefits proportionally,'' Mystrom said.

But some skeptics say the plan would be unfair to residents because it would mean less city spending in coming years.

''Commercial property gains, landlords gain, people who are politically influential gain,'' Assemblyman Dick Tremaine said. ''Common people lose because we're the ones who have to live with diminished services in the future.''

Topping the list of the city's biggest property owners last year was Hickel Investment Co., which had property valued at $92.5 million.

Mystrom's relief package would slice about $29.5 million from the amount of property taxes the municipality would collect this year. The lost revenue would be made up by using a one-time, $20 million contribution from a settlement between the city and the police and fire fighters retirement fund.

Money left over from the 1999 municipal budget, higher earnings on investments and a new car rental tax would also make up for the reduced revenue.

Mystrom has said passing tax relief on to Anchorage property owners might dissuade them from voting for a statewide property tax cap on the state's November general election ballot.